…Calls for immediate withdrawal


By Bimbola Oyesola, [email protected]

The National Union of Electricity Employees (NUEE) at the weekend raised the alarm that the recent hike in the electricity tariff will lead to more closure of businesses and manufacturing sectors in the country.

Calling for withdrawal in a letter to the Minister of Power, Adebayo Adelabu, NUEE warned that the hike in the electricity tariff is grossly detrimental to the economic diversification, growth, and well-being of Nigerians.

In the letter signed by the Acting General Secretary of the union, Dominic Igwebike, the union noted that the “recent hike in electricity tariff from N68 /kwh to N225 /kwh is absurd in a country where the majority of the masses are grappling with basic survival and an electricity access rate of about 55%.”

He reasoned that the justification given by National Electricity Regulatory Commission (NERC) that the hike is attributed to only Band A consumers who make up only 15% of electricity consumers and utilize 40% of the nation’s electricity consumption is not justifiable as the products from the companies in Band A still comes back to the general public.

“The additional costs will be transferred to the common man, so they are indirectly being exploited, notwithstanding their dwindling purchasing power and increasing impoverishment,” he said.

The union gave a scenario that companies which used 1000 kwh of energy for production in 24 hours will have a daily energy cost increase from N50,592,000 to N167,400,000 which is an additional direct cost of N116,808,000 or 231%, apart from the increase in the cost of other inputs.

He expressed that the products from the manufacturers will go up by about 300%, which will indirectly be borne by the consumers who do not have the purchasing power to buy at the new rate.

Igwebike added that this would lead to closure of many companies, unemployment insecurity and government spending more than the money made in fighting insecurity.

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Another implication is turning Nigeria into a dumping ground, as imported and smuggled items will be far cheaper than than products from other countries  thereby supporting the economy and employment situation those countries.

“This is why the US, UK, France, Germany, and all developed economies support their factories with billions invested in power subsidies,” he said.

According to NUEE, “Electricity in Egypt is on an average of N21.68 per kwh, and in South Africa, it is N226 per kwh. The minimum wage in Egypt is N78,360 while in South Africa it is N328,395.

“The minimum wage in Nigeria is N30,000 while the new electricity tariff is N255 per kwh.”

The union added that a country that genuinely has the interest of its people at heart and wants to grow will ensure that the real sector is given the utmost support it can get and not putting a nail in its coffin.

Emphasizing the importance of the union as one of the critical stakeholders in the electricity sector, the NUEE Acting Scribe said the safety of the members is at stake, as they are at the risk of being attacked by people in the community when they visit for disconnections of light.

The union, lamenting that the Minister of Power and NERC did not consult with the stakeholders in the sector before the increase, added that “the Minister of Power has relegated himself as the spokesperson for the DISCOs where he is justifying Cost Reflective Tariffs.”

“What of Service Reflective Tariffs as it relates to consumers? We as a stakeholder do not know the Energy policy of this present administration” maintaining that, as a critical stakeholder in the Power Sector who is concerned with Nigerians getting constant and affordable power supply, “we state categorically that the hike in the electricity tariff is not beneficial to Nigerians and should be withdrawn.” 

The union reiterated that there hasn’t been any meaningful improvement in the nation’s electricity since the privatization of the Power Sector.

“The country has an installed capacity of about 14,000MW, but generates about 4,803MW, meanwhile, Nigeria needs at least 30,000MW to reach sufficiency,” it stressed.